Is It Time to Add Kimco Realty (KIM) to Your Portfolio?

We have updated our research report on Kimco Realty CorporationKIM on Nov 13, 2015.

Earlier this month, Kimco Realty reported third-quarter 2015 adjusted funds from operations ("FFO") per share of 36 cents, a penny short of the Zacks Consensus Estimate and flat year over year.

Nevertheless, the company raised its 2015 guidance and announced a 6.3% hike in its quarterly dividend. Kimco is also getting rid of the non-core assets in its portfolio and joint-venture stakes in a bid to achieve a more streamlined business model.

In the reported quarter, the company completed the sale of its interests in 19 Canadian shopping centers to RioCan Real Estate Investment Trust for C$477.3 million. Another 26 Canadian properties are under contract for sale or have an accepted offer with Kimco share aggregating around C$773.9 million.

Importantly, this retail real estate investment trust (REIT) has acquired 199 properties for a gross amount of $5.3 billion, and sold 267 properties aggregating $2.5 billion, since the company started its portfolio transformation in Sep 2010.

Going forward, solid demand for Kimco's properties, its portfolio transformation initiatives and easy access to capital bode well. Nevertheless, near-term earnings dilution led by high disposition activity and an anticipated rise in interest rates in the coming months remain concerns.

Echoing similar sentiments, over the past 7 days, the Zacks Consensus Estimate for the stock has moved up a penny to $1.52 for 2015 and remained unchanged at $1.54 for 2016. Currently, Kimco carries a Zacks Rank #3 (Hold).

Key Picks from the Sector

Investors interested in the retail REIT industry may consider stocks like Rouse Properties, Inc. RSE , Simon Property Group Inc. SPG and Taubman Centers, Inc. TCO . All three stocks have a Zacks Rank #2 (Buy).

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SIMON PROPERTY (SPG): Free Stock Analysis Report

KIMCO REALTY CO (KIM): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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